It is hard to believe that it is already 2014.
I started this blog a little over 1 year ago to chronicle my climb out of debt. My goal for 2013 started off nobly enough. I was fed up with debt. I was going to pay off $30,000 of credit card debt as Phase 1 of a larger debt reduction plan. Did I accomplish this goal? No. Not even close.
Total paid down: $7,000+. That’s it??!!
I still have $22,599.00 of credit card debt remaining. How is this possible?
I set up a budget, sold a bunch of stuff, moved to lower my rent from $1265 to $425, and got a second job. Moving and giving up my stuff and my privacy, was a bittersweet experience, but I was ready to start eliminating some major debt. Life, however, had a curveball for me. Things had been going downhill at work at that time and after a particularly stressful rough patch I lost my full-time job immediately upon preparing to start this journey. (To be honest, I’m still a little bitter about how it all went down, but I’m trying to move on.) I collected unemployment for three months until I found a new job that required a move to a new state. This process, including the expense of moving and having to quickly find a new place to live, put me further behind in my debt repayment goals.
I’ve been thinking about the silver lining of my debt cloud. I was lucky to land a job that paid more than my old job, but I now live in a much higher cost of living area. I set up a new budget, but sticking to it has been a challenge, as it was likely too tight.
Last week I quit my second job. I deliberated about it for quite a while, but the number of hours that were expected of us for the same pay, made the effort not worth it.
The second employer advertised that employees would only have to work 8-10 per week, but after starting, they made more and more requirements that we had to meet in order to “meet expectations” for continued employment. It was more like 15-20 hours/week worth of work that they wanted for the same flat payment. I was already putting in 50-55 hours per week at my full-time job. Working 65+ hours per week started to wear me down. I’ve started developing a few chronic health issues. I’ve also been sick multiple times and stress has been a part of it. I had to let the second job go. It was not worth losing my health over. I will still seek additional income, but only after a break.
What will I do in 2014?
I will focus on lowering my living expenses. When my lease is up will move to save as much on rent as I can without sacrificing safety. I will start a few months early so I don’t have to overpay on rent out of desperation like I did when I moved here not long ago. Not sure if I should throw everything at the credit card debt or start a 401k. I’m leaning toward the latter. I’m almost 40 and have NO retirement savings of any kind, which scares me. That is part of what burns me up about debt. Now I understand the meaning of opportunity cost. I think about all the money that I am going to spend paying off debt. If I put that same money into different investment vehicles, I could retire early and have a MUCH better life right now.
But I can’t dwell on that. You live and you learn. I’m going to have a different standard of living than I envisioned for myself, probably for the rest of my life. Extreme frugality is not for everyone, but it is for me. It is my only hope. I have to take my own advice and start paring down even more.
I want to pay off the credit card this year. Next year I focus on maxing out retirement funding and pouring everything else into my six figure student loan debt.
Here is to an electric 2014!
“Debtor’s prison is real, and opportunity cost is a bitch.” (DDSW)